5 Failure Factors of CRM Implementation

5 Failure Factors that You Should Know for Successful CRM Implementation

In this article, I will explain the failure factors of CRM implementation.

“Please tell me the case where you failed by implementing a CRM system” is a pretty common question. Most of the time, when I ask about success stories and success factors, all I get is business-speak. Listening to “failure cases” is a very right approach.

However, since case studies are only about results, I explain the factors that lead to failure. 

Based on my CRM experience for many years, I will list five essential factors of CRM implementation failure that are not widely known.

Table of contents:

• Awareness-raising is a prerequisite for system implementation
• The amount of work will increase more than the current situation
• Systemizing current operation as it is
• Align business with the package
• Not making a proper proposal and not making a project team
• Summary

Awareness-raising is a prerequisite for system implementation

This case is the most common failure in implementing SFA (sales force automation) and CRM systems. Paradoxically, it is not so easy to change the mindset of salespeople.

For example, the idea of “changing from personal sales to an organized sales” is not wrong. However, just implementing a system does not change from a person’s sales to an organized sales. It can be very dangerous when a system vendor says, “You need to change your mindset to have a successful CRM (SFA) deployment.”

Of course, it’s necessary to change awareness, but it has nothing to do with system implementation. 

As a result of the system implementation, there is a possibility that the overall awareness will gradually change. However, if the system is implemented on this premise, it will fail first.

As an aside, I have consulted several times on “strengthening sales force” projects that do not involve system implementation. It took about a year for me to discuss with the sales managers who participated in the project, to summarize the ideal form of the company’s sales management, to unify the methods of project management and subordinate guidance, and to be able to turn it around like a real business. The cost received will also be a considerable amount.

In the end, I am proud to say that it turned out to be a good and satisfying experience for the field, but if I may write from my experience, sales reform is not something that can be done “just in time” for system implementation.

Besides, when it comes to the approach of “changing awareness,” this involves mental issues, so I think the only way is to attend a training camp (although I do not recommend it).

Increased workload compared to the current situation

It is a story related to the first point: “Awareness-rasing is a prerequisite.” but if CRM (SFA) input work occurs in addition to the tasks you are doing now, the implementation of the system will result in more work than before.

As I mentioned in the previous example, if they change the way of doing things, such as from case management using Excel to using CRM, they will do the CRM input work uncomfortably on top of what they have been doing.

When the management team is in high spirits right after the system implementation, they will force themselves to use CRM, but after a while, of course, no one will use it and will fail.

Systematize the current operation as it is

This case is also one of the common failure cases. 

Systematize the work you are doing now anyway. Systematize the current inefficient or incorrect work as it is to meet the demands of the field.

Of course, development costs will increase, and we don’t know what to implement the system for in the first place. In such a case, there is no failure of not being used, but are the results worth the system investment? From this point of view, I would say it is a complete failure.

Align business with the package

In the case of ERP implementation, we still hear the phrase “the package is a best practice, so you should adapt your business to the package.”

However, in the case of accounting, for example, “using the system = executing the business,” but in the case of CRM, “improving customer satisfaction,” “expanding customer contact,” and “sales support” are the objectives, so “using the system = executing the business” is not the case. Therefore, if you take the system implemented by the company that is famous for its strong marketing and sales, it does not mean that your company will be as good at marketing and sales as that company.

In the marketing and sales fields, best practices can be the company’s organization, systems, human resources, culture, top management, not IT systems.

You need to take a multifaceted view of your products and services, your target customers, your company’s position, and your company’s strengths and weaknesses and clarify how to change the current way of doing things specifically. And then match the system to the business side.

Not making a proper proposal and not making a project team

Implementing a CRM system means, in no small part, changing your existing marketing, sales, and support methods. Simply copying and pasting the vendor’s proposal and leaving the implementation to a vendor is a sure way to fail. In this respect, there is no such thing as an odd strategy.

Of course, you need to identify gaps between what your company should be and what you are currently in, put together a plan, and form a project team to implement it. Also, some companies throw away the planning phase to a consultant, but this also fails.

If you leave it up to a vendor or consultants, you can blame them for any failures, but when implementing CRM, you need to be proactive in solving your problems yourself and use the consultants or vendor well.

Summary

CRM systems themselves are becoming more and more ready to use if you apply in the cloud, and the hurdles to adoption have dropped significantly compared to the past. However, there are still many companies that have failed to implement CRM. Many companies don’t seem to be aware that they are failing because the CRM system has become easy to implement.

For example, “It’s not perfect, but we are registering and referring to corporate data and business card information, and in some departments, we are registering sales activities.” It doesn’t have to be a large-scale system for this level of usage. However, some companies have been paying a large amount of money every month to SaaS vendors because they can’t stop using the system. From my point of view, this is another failed implementation.

Well, I mentioned 5 cases of CRM implementation failure plus alpha points. What do you think? 

To reduce such failures as much as possible, I hope you will find this information useful when implementing CRM.